Congratulations to Mr. Kundu for his elevation to the position of MD. A couple of questions. The first one, if you can help us understand, if we see the PCR in LAP and SME segment, you have taken down materially. So, what is driving this sort of -- what gives you, in this quarter, particularly, where you see some kind of rise in delinquencies and also, I mean, so the PCR reduction in these 2 segments or the LAP and SME material, what is driving that? And the ECL in the vehicle seems to be inching up, I mean, of course, the Q4 to Q1 is typically seasonality, but even if I take on longer-term trend also there's a jump. So, this bit if you can clarify? Second, yield in the vehicle segment seems to be sort of had come off. Is it because of some mix of vehicles that had changed in your portfolio this quarter or something else?
Questions across 68 calls
Avinash Singh
Emkay Global
Cholamandalam Investment and Finance Company Limited
Two questions. First, on the disbursement and AUM growth outlook for FY ‘25, can you just please help with some sort of a breakdown among the different segments? That ’s one. And second, if you can also help with the balance transfer trends across your different products, that would be helpful.
And what sort of a transfer, you are seeing, I mean, the loan going out of your portfolio maybe because of...
A couple of questions. The first one is regarding your credit cost and provision cover. So, particularly if you look in Q3 versus Q2, the provision cover has come materially lower in the other segment. Now, one can understand there could be some sort of a change in the asset mix within that segment, but I mean , just in one quarter taking down provision cover to 45% from close to 64%, what explains this provision cover change in this other segment? That's one. And second, if we see the fee and commission income has seen a material jump. You have noticed two accounts mentioned that you got the insurance broker license. But earlier also , you would have been sort of selling insurance and the income would have been recognizing some other lines. So, what has changed here ? And is this higher fee and commission income sustainable or was it some sort of a one-time, some one-off?
So, this level of fee income is sustainable. And on this PCR again, so in other segment it's largely unsecured, I mean, personal loan and other unsecured. So, this 45% coverage, you think is sufficient?
SBI Life Insurance Company Limited
A couple of questi ons. The first one is more around what will be your strategy around protection, encompassing both the retail protection and credit life? Because I mean on the credit life side you have a large bank like SBI as a partner and also on the retail side you have a big reach. But since last almost more than a year , protection somehow seems to be losing momentum, at least on a relative basis to savings. So, what is going to be the strategy to sort of improve our protection share in the product mix, particularly the retail protection and credit life , GTI separating for the moment ? So that ’s first question and the second question if you can sort of outline on your strategy or plans around product design or the commission tweaking post September 30th.Once this new product has to be sort of filed where you have this enhanced special surrender value . So, what are your thoughts on sort of our impact in terms of how we are going to deal with the you know balancing the margin or payout to the persistent customers at the same time the commission payout?
On first part on credit life, do you have any plans to sort of meaningfully improve traction beyond home loans? Bec ause now SBI of course is pretty big in auto loan , even in personal loan their reasonably big. Are you looking to sort of increase penetration of credit life in auto loan customer or personal loan customer or is the home loan going to be the core area?
Good set of numbers, particularly on the margin , in the backdrop of how the product mix had changed and everything. A couple of questions here. First one on agency channel. I'm cognizant of the fact that the quarter 3 is typically more a banca-dominated, however, on a year -on-year basically the seasonal ity is added, but somehow agency channel growth seemed to have slowed down meaningfully in quarter 3. So, what is happening there and how are you trying to improve in the next quarter and going forward on the agency channel? So that is question one. Second piece is more on the cost, of course your costs are by far better in the industry and among the peer set. However, I mean, if we were to look at the numbers, there seems to be certain increase happening. I mean, of course, in the total premium ratio, it will not reflect, but in the absolute basis, the costs, I mean, commission and rewards as well as the opex seems to be increasing. So, what is leading to this, is it because of headcount increase or certain commission reward structure, linking across partners? So, what is sort of leading and where should one see it going forward? So, these are my two questions.
Okay. Sir, actually, yes, so agency actually are referring. In the first half, the agency channel was growing at close to 20 -odd percent in retail APE -- individual APE terms. That 20% has gone to 15% whereas banca is more or less like maintaining at 15% and others are kind of maintaining in and around 20%. That's why what I was referring that in the first half, it was like 20%, now in the 9 months, it's 15%. So basically, the quarter gone by has seen a material sort of a slowdown so that's why.
Mahindra & Mahindra Financial Services Limited
A couple of questions. First one, again, more from the medium terms or that this 1.8% ROE that now comes of so many moving parts. Now you also have a stated strategy to sort of move up in the sort of a customer profile that will, of course, put some pace around your asset yield. Of course, I mean, over the coming quarters and years, you will benefit from the cost of funding side. But then I mean, opex is kind of a very sticky at around 40% cost -to-income ratio of course, even there is some improvement. But if one were to look at some 70 basis point improvement that is needed for ROA level, how are you sort of seeing -- I mean, given your kind of the product offering in mind, the customer profile that you are seeing, which are they, because I mean cost side also it does not seen that, okay, given the kind of your model, the product mix and customer that's going to come up dramatically. And credit cost is already now irrespective, particularly if I've got a quarter number, 1.5%. So that is question one. Second, I mean, again, related to the ECL, if I go through the presentation disclosure, there's sort of a negative movement for Stage 1. So basically, now Stage 1, your comments are almost like coming to 60 basis points from 80 basis points a year ago. Now lastly, the product segment has not changed that dramatically. I understand that what you are saying on the LGD side. But for Stage 1, has your PD estimates also changed, I mean, d ramatically, that's sort of a leading from 0.8% coverage, invested 1 year back to now 0.6% and almost like a Stage 1 provision in fact, reduced slightly even though, okay, there is AUM growth, 25%?
Very clear. The 2.2%, again, you are saying is the quarter exit for Q4 or for the full year? Because I mean, if it's a full year, then again for the 9 months, your ask rate will be 2.3% plus.
Few questions. First one on your FY25 targets , now looking back and of course you have explained, I mean only pieces, but looking back now if you see that 2.5% ROA as an outcome where did sort of, what inputs or where you missed that, I mean this target now has to sort of a revised 2 or 2.2 % odd a nd I am asking particularly because even when in the past, you were reiterating this sort of a target, the analyst investor were sort of pointing out that, things are not adding up, the way the NIM was playing out or the OPEX eventually it was not looking. So, at this just if you can help us where sort of or when you sort of had chosen this 2.5% target and where you are today, what has sort of came in at for expectations watching over this last 2 -3 years? That is one? Second, again, you have provided a lot of details and clarification around this fraud, so only thing of course with the hindsight sort of, I would say information intelligence in place. Considering that it is the Northeast place like Aizawl and the extent of Rs. 136 odd crores, a couple of things, if this was the sort of extent particularly Rs. 136 crores amount as such would be a really big amount for even your larger branches and that too particularly the small place, this big amount that I mean entirety of fraud even I mean over this course of fraud loans being booked, your probably the market share in the vehicle loan in that particular set you would have been going up and why did it take so long for you to sort of detect almost like a 3000 close accounts to Rs. 135 odd crores kind of amount that to in a small place , where all sort of a things went wrong that it took s o long to detect, because I mean sort of I am aware of certain sort of this kind of a nature of some frauds happening even with some public sector banks in certain branches, but generally even for the banks, and that to be the bigger branch level balance see, typically it gets detected at an early stage in Rs. 15-20 crores, but here is Rs. 135 crores for MMFS and that too in Aizawl. So, what sort of lapses did you sort of find that okay this went to such a scale?
ICICI Prudential Life Insurance Company Limited
A couple of questions. The first one, more sort of a near term. Of course, you have touched upon this point many times. On the retail protection, I mean, is sort of your growth in line broadly with the market? And also going forward, the growth, will it be kind of driven by volume or the ticket sizes? I mean, any sort of a pricing action, because the media was reporting very recently that there are kind of scenarios where, you know, leading life insurer taking price hike in this business So, I mean, the outlook on sort of the volume growth and the pricing action. That's one. Second, more from a medium-term a bit of I would say jumping on, as, I mean, IndAS lead to sort of some release of capital or like a scenario being overcapitalized, so what would be sort of alternate available for insurer like you in terms of optimising your capital allocation? I mean, what to do with the surplus capital, whatever preferred option that regulatorily that you will be allowed, I mean, to take out that capital or do something else?
ICICI Lombard General Insurance Company Limited
Couple of questions. The first one, if you can help again on motor where you explained that share of old had gone up. How it has panned out in various distribution channels, I mean, agents, or is it gaining share from other peers at the OEM dealer point or is it something to do with the new corporate broker or online broker tie up you have done? That's one. Second is, I mean, if I look at the motor third party loss ratio of 69% for the quarter, is it just based on this quarter or is there some support coming? Because if I see the industry, you are the only one who has in motor TP for FY2022 or FY2023, you have not taken any kind of a year TP ratio so far . So, is the 69% now getting some support from this quarter only? And if you can give some kind of idea that how, if, I mean, in the Ind AS, when reserve discounting is allowed, how the 69% would typically look?
Couple of questions, the first one on commercial line, i.e. fire, marine, engineering, if I look on a 9 -month basis the movement Y -o-Y in claims ratio is material now, in terms of NATCAT it would have played out maybe a bit higher this year, but not material, so now this question is that is this sort of a claims ratio increase in the commercial lines an outcome of any pricing deterioration at the industrial level or is it largely due to the reinsurance price hike that industry has seen, so I mean some color on what is driving this commercial line loss ratio increas e and if the factors , that I just mentioned, the pricing deterioration or reinsurance price hike if they are largely done this year and should improve going forward next year? That is one, second again going on health, overall growth is reasonably good, growth is of course led by the pricing as well as some kind of volume growth, yet the claims ratio at the aggregate level of course, if you go segment by segment, there could be some difference, but at an aggregate level, claims ratio is still inching up, now is this an outcome of just the claims inflation or claims frequency is reflecting some kind of increase year-on-year?
HDFC Life Insurance Company Limited
A few questions. The first one is regarding the sensitivity to taxes and the corporate tax rate being increased. If I see your sensitivity to VNB margins, it appears reasonably high. Just wanted to clarify that when you are showing the sensitivity from corporate tax going to 25%, are you also assuming all the exemptions being taken away? Or it is like that, okay, 14% where it's applicable going to 25% and then you are showing sensitivity? Because there is reasonable variance in sensitivities as far as VNB is concerned. I wanted clarity on how are you calculating these sensitivities? Second is related to credit life. Can you help out a bit more , is the competition intense in mortgages or in short tenure products like personal loan , micro finance and durables? Where are you seeing intense competition? And has that led that on a like -to-like basis, this quarter, the margin profile overall on the group side of the product being lower than what it was last year same quarter?
Okay. Just a follow -up. So whatever exemption you are assuming, you are assuming that policyholder surplus that gets taxed in par as well as your shareholder PBT, both getting taxed at 25%?
A few questions. The first one is regarding the sensitivity to taxes and the corporate tax rate being increased. If I see your sensitivity to VNB margins, it appears reasonably high. Just wanted to clarify that when you are showing the sensitivity from corporate tax going to 25%, are you also assuming all the exemptions being taken away? Or it is like that, okay, 14% where it's applicable going to 25% and then you are showing sensitivity? Because there is reasonable variance in sensitivities as far as VNB is concerned. I wanted clarity on how are you calculating these sensitivities? Second is related to credit life. Can you help out a bit more , is the competition intense in mortgages or in short tenure products like personal loan , micro finance and durables? Where are you seeing intense competition? And has that led that on a like -to-like basis, this quarter, the margin profile overall on the group side of the product being lower than what it was last year same quarter?
Okay. Just a follow -up. So whatever exemption you are assuming, you are assuming that policyholder surplus that gets taxed in par as well as your shareholder PBT, both getting taxed at 25%?
Shriram Finance Limited
So, a couple of questions. The one would be on, again, continuing on the stress part. So, I mean, like the MFI and a few other segments. But the personal loan segment also is seeing a bit of a rise in stress. Now in this backdrop, your portfolio seems to be doing fine. Now, the thing is that, I mean, what kind of growth are you seeing there and if at all any sort of a color on future
So, a couple of questions. The one would be on, again, continuing on the stress part. So, I mean, like the MFI and a few other segments. But the personal loan segment also is seeing a bit of a rise in stress. Now in this backdrop, your portfolio seems to be doing fine. Now, the thing is that, I mean, what kind of growth are you seeing there and if at all any sort of a color on future tiSHRIF iAM
My question is on credit cost. I recall you explained some changes into the PD and LGD. I mean, this quarter has seen increased credit cost, and you are still maintaining 2% guidance. So, which product segment particularly has sort of led to or rather you are seeing your PD , LDG changing more and despite this increase you are still guiding for 2%, so I mean where do you sort of see that, okay this will moderate? The second one again related would be now on your personal loan segment, your overall GS3 PCR is 53%-odd whereas I mean in the personal loan that's largely unsecured and of course you are still kind of keeping it around 50%-odd, so what is sort of leading to that having a personal loan PCR being lower than your overall PCR?
On Shriram Housing, your subsidiary, also the growth is pretty strong and particularly on the core lending B S side. So, if you can help us understan d, I mean who are your kind of a key partner among the banks , and also I mean there has been a sort of reporting of your plan to divest this, so I mean, what's going on there?
REC Limited
First question is that assuming this RBI circular was to come in the current form, I mean, will it sort of a lead to change in competitive dynamics in the lending space to the power sector . I'm coming. I mean, yes, I mean, you could be comfortable position, but led to some banks, I mean who currently present kind of withdrawing or so going slow in the power sector loans. So I mean, how will that play out? And the second part, if at all, the sort of the impact that is going to impact -- having impact on your sort of capital and all. Will sort of you be looking to pass on the pump prices or to our capital P&L impact but definitely, it is going to impact your So will there be some kind of some costs that we pass on to the borrower?
Yes. So in that scenario, do you see sort of benefiting from that competitive dynamics changing? I mean, if at all the banks are passing some period also sort of looking to benefit from that. And if at all the banks are sort of going smooth in the power sector loan will see some uptick.
Max Financial Services Limited
Just on set of performance couple of questions. The first one is on embedded value walk. The non - operating variance that I presume it will be mostly economic varian ce, and that appears slight negative. Now if we look the way equity has behaved as well as the yield kind of a movement that you have given in slide 59, there should be some sort of a contribution from both the factors coming as minor positive maybe 1% or anyway between 1% to 2% positive, but here, it is Negative so if there is something more than the economic variance , assumption change or whatever I'm missing here? I mean if you can clarify on that. And the second question, if I come to particularly the Q4 part of our GAAP result, I know that Max Life GAAP results, I guess it is not out. Now I understand, I mean, a large part of probably the GAAP profit decline or rather turning into loss it could be due to new business as explained. But can you help? I mean, is this new business explain totally reflects our product mix change only because I mean last year also you had a strong amount of non -PAR typically have been high strain. So is this new business only due to new business strain? Is it a new business strain only due to production mix changes or sort of a payout increases or any sort of a weakness in back book supply, if you can help.
So this operating variance would be mostly around expenses or some mortality persistency even sir?
Bajaj Finance Limited
A few questions. The first one, the way you were highlighting the challenge in the rural B2C. And if you look at some of your new segments, maybe gold, of course, you separated, MFI and up to certain use making, they are kind of a bit -- or a similar in nature to the rural B2C. In this backdrop, on one hand, you are going slow on rural B2C. So how do you see these segments to sort of come over the next couple of years? So that's question one. And second would be more into -- do with BHFL. Of course, coming from a smaller base, you are ramping up very fast also on the LRD and developer finance. Now developer finance is a bit, I think, reasonably cyclical business and the cycle turns quite fast. Right now, of course, I mean, real estate cycle looks quite good. So what sort of -- any sort of growth plan you have, particularly for this developer financing side and as well as what kind of early -warning system you would have in place to...
And in the LRD, I mean, how we see competitive environment? I mean, because LRD, even banks are reasonably...
Life Insurance Corporation Of India
Thanks for the opportunity and a good set of performance. A couple of questions. The first one is more on the margin side. So if I see 2 parts of margin, I mean, the non-par and par, at such a large scale, par margin Y-o-Y is appearing to be declining slightly. Now what explains that? Because generally par margins are stable and even interest rates have been broadly stable. So what explains minor drop in par margin. And on the non-par side, I mean, including ULIP or 63% kind of a margin with a little help from protection looks pretty strong. Now that would mean that you know that in terms of your benefit offering likely would be lower than what your competitors are offering on the non-par savings and annuity side. So if competition heats up and you were to sort of improve your offerings in these 2 non-par and annuity. Do you think that this 63% can come under pressure? Of course, I am cognizant of the fact that at the overall level your non-pap share will sort of increase, but the non-par margins. So just I want explanation that what is causing sort of a pressure on par margins? And what sort of you know margins do you think that can be sustained in this non-par? That's my first question. I will come with second question later.
Okay. Just on par, just to confirm, Y-o-Y 9-month margins – or this minor dip, is it not caused by any sort of a change in operating side, either the expenses or the persistency behavior? Or some contribution coming out of these two factors as well?
General Insurance Corporation of India
So the first question goes around the risk management. So if we were to say, I mean, two parts to it, one that, I mean, just not a matter of quarter or 1, two years, almost for the last 7, eight years, international business has been just in a pain point. Now from a reinsurance perspective, it's sort of obvious argument that you need to be geographically diversified. But it seems that this diversification is not working, like 7, eight years in a continuous row when the price hike has environment has hardened, there have been good, bad ugly years, yet a very, very big loss. Now the next question that is on this, you're also following up on the risk management practices. Particularly if we see around COVID times, you sort of had increased exposure in Life particularly in India, and you sort of had a big underwriting losses, almost INR1,000 crores plus from that Life line item. That's a small line item typically for you because you did not have a retrocession on the Life side. Here, again, on the marine overseas, I mean, the book was sort of a stop -- the treaty was stopped in 2021. So of course, you would have IBNR at that time. But yet in FY24, you are seeing in two quarters -- around nine months, INR2,500 crores cost rather -- providing for those treaties and almost like your claims ratio are going. So now again, question here is that, wasn't there a sort of a retrocession cover for these kind of policies. So the question here is that, okay, what kind of a retrocession policy do we have? Because it seems that, okay, in certain a smaller line item that claims ratios or claims -- absolute claims are going through the roof. And if that is sort of the case, I me an what are our sort of retrocession policies? And then also that what is our thought because it's not 1, two years, almost 7, eight years in a row and international has been just a pain point. So what is sort of our thought process there?
But again, here just two follow-ups. So one, again, on international, of c ourse, in these same seven, eight years barring maybe a few quarters, the global big like a Swiss, Munich or Hanover I mean, the top five ones, they have done kind of a 100% -- some 100% kind of combined in these seven , eight years, whereas our combined ratio international is almost like for the last seven, eight years, it's like 115% plus. So definitely there's a big gap. So I mean, we cannot sort of explain it with what is happening in those markets, that's one. And of course, I'm not questioning about domestic, because domestic more or less, you have two advantages. But even if it's a higher combined ratio, your float income is pretty high in domestic. So domestic can operate it to a different. My question always has been overseas because your investment returns are also poor generally in overseas book. And of course, so you have to operate in a different combined, but as a matter of fact that combined has been to other. On retrocession my question was more again on the like, again, not just for this marine, of course, this marine anyway you're expertise still, but something like a Life going back during COVID times. Life is typically not having your expertise, but you had been increasing -- because the domestic market was growing in the Life primary being protection side. So you increased your share dramatically and of course, you saw big losses in COVID something like, okay. It has wiped out your entire many years of maybe perhaps underwriting profit on the Life side. So when you are sort of venturing into an area that is not typically your forte, that was life. And actually you were not having a retrocession, but that was kin d of a reflection a bit poor on risk management.
Star Health and Allied Insurance Company Limited
Couple of questions. The first one more on sort of industry with this latest kind of announcement on this Cashless Everywhere, how does this came sort of, the network hospital concept or agreed Network hospital I mean, because now with this concept at least for accessibility point of view, every policy holder from any insurer has cashless access to hospitals. So, I mean, how does this sort of thing changes? Does it change anything in terms of the positioning of a Health Insurance as far as the network hospitals are concerned and if at all anything in terms of pricing which you agreed Network Hospital, so that is one? Second question sort of what kind of a medical inflation you are seeing, I mean in so far say or calendar 23 or FY24 and has sort of changed towards up or down in the post COVID what you were seeing in the post COVID era? And related to that, based on this claim inflation or medical inflation trend and also that you and the industry has undertaken multiple price hikes in Retail Health. Going forward, you see that prices to be stabilizing or still some need to take price hike?